Ray Dalio’s Bridgewater Associates, the world’s largest hedge-fund firm, with $120 billion in assets, has hit a rough patch.

After leaving its rivals in the dust for the past two years with mouth-watering double-digit returns, Bridgewater is now trailing them. Its flagship fund, Pure Alpha, fell 2.7 percent in 2012’s first half.

Dalio is a widely watched guru of the financial markets. But his devotion to the dollar helped drive Pure Alpha into the red, a source close to the fund told The Post.

As Europeans managed to hold their fragile union together, the euro rebounded against the dollar in June. The dollar also fell against the yen.

Dalio recently told investors that the US is in better shape than other countries. That said, his long Treasury position lost money in June when rates backed up.

Bridgewater has also been invested in commodities like gold and oil, which have tumbled.

“The twists and turns of the euro crisis have surprised most of the hedge-fund community,” said Daniel Celeghin, a partner at Casey, Quirk & Associates, which advises hedge- fund managers.